A month ago, American said it was about to beat Q2 expectations; United keeps guidance intact
American Airlines Group Inc. late Tuesday slashed its guidance for the current quarter, roughly one month after offering an upbeat take for the three-month period, which includes the height of summer air travel in the U.S.
American said it expects it will report second-quarter adjusted earnings of about $1 to $1.15 a share. That compares to a late April guidance of adjusted EPS between $1.15 and $1.45 for the quarter.
The air carrier did not detail a reason for the lowered guidance. FactSet consensus calls for adjusted earnings of $1.30 a share.
American also said its chief commercial officer, Vasu Raja, is stepping down after two years in the job, and will be replaced by Vice Chair and Chief Strategy Officer Stephen Johnson until a permanent replacement is hired.
Shares of American AAL, -2.89% dropped 6.3% in the extended session, after ending the regular trading day down 2.9%.
United Airlines Holdings Inc. UAL, -2.11% also updated investors about its second-quarter guidance, with the carrier saying Tuesday it still expected adjusted EPS between $3.75 and $4.25.
American also cut its expectations for adjusted operating margin to 8.5% to 10.5%, from a previous expectation of 9.5% to 11.5%. Average fuel cost was lowered to between $2.70 a gallon and $2.80 a gallon, compared with an earlier call of $2.75 a gallon to $2.95 a gallon.
Shares of American are down 2% so far this year, contrasting with an advance of about 11% for the S&P 500 index SPX and 4.8% for the U.S. Global Jets ETF JETS.